Precision inertial navigation depends not only on the quality of the inertial sensors (accelerometers and gyros), but also on the accuracy of the gravity compensation. With a view toward the next-generation inertial navigation systems, based on sensors whose errors contribute as little as a few metres per hour to the navigation error budget, we have analyzed the required quality of gravity compensation to the navigation solution. The investigation considered a standard compensation method using ground data to predict the gravity vector at altitude for aircraft free-inertial navigation. The navigation effects of the compensation errors were examined using gravity data in two gravimetrically distinct areas and a navigation simulator with parameters such as data noise and resolution, supplemental global gravity model noise, and on-track interpolation method. For a typical flight trajectory at 5 km altitude and 300 km/hr aircraft speed, the error in gravity compensation contributes less than 5 m to the position error after one hour of free-inertial navigation if the ground data are gridded with 2 arcmin resolution and are accurate to better than 5 mGal.